State Dept cable 1974-123286

Declassified/Released US Department of State EO Systematic Review 30 JUN 2005

Message Text

CONFIDENTIAL

PAGE 01 ANKARA 04453 071510Z
50

ACTION EUR-25

INFO OCT-01 ISO-OO NEA-14 AEC-11 AID-20 CEA-02 CIAE-00

CIEP-02 COME-OO DODE-OO EB-11 FEAE-00 FPC-01 H-03

INR-10 INT-08 L-03 NSAE-00 NSC-07 OMB-01 PM-07 RSC-01

SAM-01 SCI-06 SP-03 SS-20 STR-08 TRSE-00 DRC-01

EURE-00 PA-04 PRS-01 USIA-15 /186W

069965

P R 07 1421Z JUN 74
FM AMEMBASSY ANKARA
TO SECSTATE WASHDC PRIORITY 4481
INFO AMCONSUL ADANA
AMCONSUL ISTANBUL
AMCONSUL IZMIR

CONFIDENTIAL ANKARA 4453

E.O. 11652: GDS
TAGS: EGEN, ENRG.TU

SUBJECT:MOBIL AND BP HAVE CEASED IMPORTING OIL INTO TURKEY
REF: ANKARA 4277

1. TODAY, JUNE 7, MARC CASANOVA, THE HEAD OF THE MOBIL
COMPANIES IN TURKEY, CALLED ON ME TO EXPLAIN WHY MOBIL AND BP
HAD CEASED IMPORTING OIL INTO TURKEY. CONFIRMING INFORMATION
IN REFTEL, HE SAID THAT DESPITE ALL HIS EDUCATIONAL AND PERSUASIVE
EFFORTS WITH OFFICIALS IN MINISTRIES OF FINANCE, AND ENERGY AND
NATURAL RESOURCES, CAHIT KAYRA (MINISTER OF ENERGY) HAD OUTRIGHT
REJECTED MOBIL'S AND BP'S REQUESTS FOR HIGHER PRICES FOR ITRTED
CRUDE AND FOR THE RIGHT TO ADJUST REFINING MARGINS AT THE ATAS
REFINERY. CASANOVA ASSERTED THAT MOBIL HAD LOST $6 MILLION
AT ATAS FROM JANUARY - MAY 1974. OF THE FIVE MOBIL COMPANIES
IN TURKEY, HE SAID, ONLY MOBIL EXPLORATION WAS PROFITABLE;
HOWEVER, MOBIL IS SUFFERING A NET LOSS. CONTRATY TO HIS
STATEMENT TO EMBOFF ON JUNE 3. HE WAS UNABLE TO SEE KAYRA
CONFIDENTIAL

CONFIDENTIAL

PAGE 02 ANKARA 04453 0715 10Z
ON JUNE 4 OR 5.

Declassified/Released US Department of State EO Systematic Review 30 JUN 2005

Declassified/Released US Department of State EO Systematic Review 30 JUN 2005

2. KAYRA SENT BOTH COMPANIES A LETTER ON JUNE 3, DEMANDING
THAT THEY RESUME THE IMPORT OF CRUDE OIL TO FULFILL THEIR
COMMITMENT SWITHIN TWO WEEKS. IF THEY REFUSED TO DO SO, HE
THREATENED TO INVOKE ARTICLE 132 OF PETROLEUM LAW WHICH PERMITS
GOVERNMENT TO DEMAND COMPLIANCE WITHIN 90 DAYS. IF COMPANIES
STILL FAIL TO COMPLY, GOVERNMENT COULD TAKE OVER OPERATION OF
ATAS FOR MINIMUM OF 90 DAYS AND MAXIMUM OF 180, AND PROPOSE

TO COUNCIL OF MINISTERS CANCELLATION OF PERMIS, LICENSES, ETC.

3. CASANOVA SAID THAT TURKISH GOVERNMENT HAD SQUEEZED MOBIL
TO POINT WHERE SOMETHING HAD TO BE DONE. DESPITE KAYRA'S
PERSONAL STATEMENT TO CASANOVA AND IMPLIED IN KAYRA'S PRESS
STATEMENTS AS WELL, THAT MOBIL COULD EASILY TAKE A LOSS AFTER
MANY PROFITABLE YEARS, CASANOVA WAS STILL RELATIVELY HOPEFUL OF
AN AGREED SOLUTION. HE MENTIONED THREE POINTS AS HIS EVIDENCE:

(1) KAYRA HAD TOLD THE MEDIA THAT LOCAL MANAGERS HAD MADE THE
DECISION WITHOUT CONSULTING HOME OFFICERS (CASANOVA SAYS NOT TRUE
BU I .RAVES MINISTER A WAY OUT IF HE CHOOSES TO BACKTRACK;

(2) TURKS HAVE SAID THAT FINAL ADJUSTMENT OF PRICES (PENDING
ARAMCO- SAUDI ARABIA AGREEMENT ABOUT JULY) WOULD BE MADE RET-
ROACTIVE TO JANUARY 1, 1974, AND (3) KAYRA'S THREAT IN HIS LETTER

TO THE TWO COMPANIES TO INVOKE ARTICLE 132 DID NOT HAVE IMMEDIATE
EFFECT BUT IN TWO WEEKS.

4. CASANOVA WILL BE IN U.S. FROM JUNE 8 TO DISCUSS PROBLEM
WITH TOPMOBIL LEADERSHIP AND IS DUE BACK IN TURKEY ON JUNE 12.

HE SAID HE WOULD CALL ONHIS RETURN TO LET ME KNOW WHAT MOBIL
HAS DECIDED AND WHETHER I COULD HELP. I ENCOURAGED HIM

TO DO SO AND SAID WE WOULD DE EVERYTHING WE APPROPRIATELY COULD
TO BE OF ASSISTANCE.

MACOMBER

CONFIDENTIAL

NNN

Declassified/Released US Department of State EO Systematic Review 30 JUN 2005

Declassified/Released US Department of State EO Systematic Review 30 JUN 2005

Message Attributes

Automatic Decaptioning: X
Capture Date: 01 JAN 1994
Channel Indicators: n/a
Current Classification: UNCLASSIFIED

Concepts: PETROLEUM, IMPORTS, BUSINESS FIRMS, PRICES

Control Number: n/a
Copy: SINGLE
Draft Date: 07 JUN 1974
Decaption Date: 01 JAN 1960
Decaption Note:

Disposition Action: RELEASED
Disposition Approved on Date:

Disposition Authority: smithrj
Disposition Case Number: n/a
Disposition Comment: 25 YEAR REVIEW
Disposition Date: 28 MAY 2004
Disposition Event:

Disposition History: n/a
Disposition Reason:

Disposition Remarks:

Document Number: 1974ANKARA04453

Document Source: CORE

Document Unique ID: 00

Drafter: n/a

Enclosure: n/a

Executive Order: GS

Errors: N/A

Film Number: D7401 45-0534
From: ANKARA
Handling Restrictions: n/a
Image Path:

ISecure: 1

Legacy Key: Iink1974/newtext/t19740667/aaaacfge.tel

Line Count: 94

Locator: TEXT ON-LINE, ON MICROFILM
Office: ACTION EUR
Original Classification: CONFIDENTIAL
Original Handling Restrictions: n/a
Original Previous Classification: n/a
Original Previous Handling Restrictions: n/a
Page Count: 2

Previous Channel Indicators: n/a
Previous Classification: CONFIDENTIAL
Previous Handling Restrictions: n/a
Reference: ANKARA 4277
Review Action: RELEASED, APPROVED
Review Authority: smithrj
Review Comment: n/a
Review Content Flags:

Review Date: 27 AUG 2002
Review Event:

Review Exemptions: n/a

Review History: RELEASED <27 AUG 2002 by elyme>; APPROVED <19 FEB 2003 by smithrj>

Review Markings:

Declassified/Released
US Department of State
EO Systematic Review
30 JUN 2005

Review Media Identifier:

Review Referrals: n/a
Review Release Date: n/a
Review Release Event: n/a
Review Transfer Date:

Review Withdrawn Fields: n/a
Secure: OPEN
Status: NATIVE

Subject: OBIL AND BP HAVE CEASED IMPORTING OIL INTO TURKEY
TAGS: EGEN, ENRG, TU, MOBIL OIL CO, BRITISH PETROLEUM
To: STATE
Type: TE

Markings: Declassified/Released US Department of State EO Systematic Review 30 JUN 2005

Declassified/Released US Department of State EO Systematic Review 30 JUN 2005